More on Revenue Cycle Management

Referral process going digital as healthcare providers look to stem revenue leakage

To capture revenue that would otherwise be lost, providers need to jettison ink and paper in favor more modern solutions.

Jeff Lagasse, Associate Editor

"Revenue leakage" -- healthcare providers cringe at the term, because it represents dollars that aren't coming into the system, but could be. Revenue cycle inefficiencies and poor communication around patient financial responsibility are factors that can cause revenue leakage, but it also occurs quite frequently in the area of referrals.

Most adults have been referred to a specialist by their provider at some point in their lives. But how many of them actually follow through and schedule an appointment? The statistics vary, of course, but the number is far short of 100%. And if a patient doesn't follow through with their referral, that's revenue that's lost to the specialist -- as well as a major speed bump on the patient's care journey.

Curtis Gattis, CEO and co-founder of health technology outfit LeadingReach, has noticed a trend that may be contributing to this: a referral system that still relies on paper documents and faxing. It's an outmoded system that often leaves the patient out of the process, and even leaves specialists themselves in the dark about which patients need to schedule an appointment.

This leads to an awkward dynamic: Specialists have a tenuous grasp on their potential for increased revenue, all while patient health is taking an unnecessary hit.

Gattis sees culpability on both sides. Specialists and other providers are simply not incentivized financially to get a better handle on referrals; meanwhile, patient apathy can also be a factor, with some perhaps not understanding the importance of, say, a rheumatology appointment. Both patient and provider need to be held to better account in this scenario.

"In value-based care, people are more judicious about referrals," said Gattis. "As a specialist, Im seeing more quality referrals. I need to be able to grow my practice effectively, and revenues are the key drivers for these specialty practices. You can't manage what you can't measure. Things today are still very paper-based. About 85% of the time, when you contact a patient for their appointment, you're getting voicemail. It's a very hit-and-miss scenario. These paper files are getting larger and larger every day."


As with most other areas of healthcare, the key to future success is in going digital. A digital referral network can replace the old-timey fax-and-paper system and actually involve the patient, as well as provide more control and transparency for the specialist.

Gattis has seen the referral-to-appointment ratio climb from a little more than 60% to more than 90% by implementing a digital, accountable transition of care. Aside from digitizing all of the information, it also creates a mechanism whereby specialists can reach out to patients, and increase the likelihood of an appointment being scheduled.

"With a digital connection, both sides can see what's going on," said Gattis. "It creates accountability on both sides. We're no longer playing the blame game. The expectations have been set on this digital foundation."

Whereas specialists typically don't have access to the files that are stuffed into those paper folders, they very much have access to them in digital form, particularly if the technology in question is modeled after CRM-style software. CRM -- or customer relationship management -- allows for managing a company's relationships and interactions with customers and potential customers.

The biggest barrier to a broader implementation of CRM-like technology in referrals is interoperability, said Gattis. It has long been one of the holy grails of healthcare to have disparate electronic health records systems that are capable of speaking to one another and sharing information.

When that goal is reached, referral technology will benefit as well -- though it's already having an impact. Gattis estimates that specialists implementing referral technologies have seen a 15 to 25% increase in revenue in the first year of implementation.

"Providers are more incentivized to reach out in a timely manner to close that gap, driving that kind of operational efficiency," he said.

While specialists benefit, the same approach can benefit imaging labs, operating rooms and delivery units as well, bringing healthcare in line with a future that will increasingly require these kinds of operational efficiencies.

"MIPS/MACRA is helping to push these kinds of measures, benefitting from the maturation of the market, as well as where CMS is pushing everyone to go," Gattis said.

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This month, Healthcare IT News, MobiHealthNews and Healthcare Finance News take a look at what all of this means and how technology, as always, is spurring innovative solutions.

Twitter: @JELagasse

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